FDIC warns US bank deposit insurance fund could tank (@$*?)

lifeismorethankicks

lifeismorethankicks

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The US government is warning banks that its deposit insurance fund could go broke this year as bank failures mount.
The head of the Federal Deposit Insurance Corporation, Sheila Bair, in a letter to bank chief executives dated March 2, defended the FDIC's plan to raise fees on banks and assess an emergency fee to shore up the fund and maintain investor confidence.

Bair acknowledged the new fees, announced Friday, would put additional pressure on banks at time of financial crisis and a deepening recession, but insisted they were critical to keep the insurance fund solvent and protect.

"Without these assessments, the deposit insurance fund could become insolvent this year," Bair wrote.

The FDIC chief said in the letter that the rapidly deteriorating economic conditions raised the prospects of "a large number" of bank failures through 2010.

"Without substantial amounts of additional assessment revenue in the near future, current projections indicate that the fund balance will approach zero or even become negative," she wrote.

The FDIC last Friday announced it would impose a temporary emergency fee on lenders and raise its regular assessments to shore up the rapidly depleting deposit insurance fund that insures individual customer deposits up to 250,000 dollars.

A week ago the FDIC reported a sharp depletion of the deposit insurance fund in the fourth quarter due to actual and anticipated bank failures, to 19 billion dollars from 34.6 billion in the third quarter.

The FDIC said it had set aside an additional 22 billion dollars for estimated losses on failures anticipated in 2009.

Source


So if this happens everyone will tkae their money out the bank and then we are all even more screwed?
Senate Banking Committee Chairman Christopher Dodd is moving to allow the Federal Deposit Insurance Corp. to temporarily borrow as much as $500 billion from the Treasury Department. http://www.foxnews.com/politics/2009/03/05/senate-moves-loan-fdic-billion/Full Story
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Originally Posted by LifeisMoreThanKicks


So if this happens everyone will tkae their money out the bank and then we are all even more screwed?
Senate Banking Committee Chairman Christopher Dodd is moving to allow the Federal Deposit Insurance Corp. to temporarily borrow as much as $500 billion from the Treasury Department. http://www.foxnews.com/politics/2009/03/05/senate-moves-loan-fdic-billion/Full Story
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wow. the government is just handing out money like its candy

but seriously... Great Depression all over again if people all rush & try to withdraw all their money at once.
 
Originally Posted by LifeisMoreThanKicks



So if this happens everyone will tkae their money out the bank and then we are all even more screwed?
Senate Banking Committee Chairman Christopher Dodd is moving to allow the Federal Deposit Insurance Corp. to temporarily borrow as much as $500 billion from the Treasury Department. http://www.foxnews.com/politics/2009/03/05/senate-moves-loan-fdic-billion/Full Story
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wow. the government is just handing out money like its candy

but seriously... Great Depression all over again if people all rush & try to withdraw all their money at once.
 
man... i thought u were talkin about U.S. Bank in particular. cuz we're just fine homie we don't have to worry about all that nonsensical bank failuretalk
 
NO matter what they can not let the FDIC go down because everyone will empty their bank account. But imagine if that happens, everyone will have their lifesavings in cash and home invasions will sky rocket.
 
Originally Posted by LifeisMoreThanKicks

NO matter what they can not let the FDIC go down because everyone will empty their bank account. But imagine if that happens, everyone will have their life savings in cash and home invasions will sky rocket.
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We'd have a lot more to worry about than home invasions if everyone withdraws.
 
I dont even got that much money to worry about. When banks fail how much money do the actual customer loose?
 
Wow. Not surprising is that this was released yesterday and I can tell nobody else heard this until now.

We're #+%$*@ if this happens. I may as well withdraw my money now anyways. I went from earning around 4.5% APY when I started to 1.65% APY now.
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my lil 10G account not even earnin 1% lol, If FDIC fails though, the country is goin to hell, and thats in no way an exaggeration
 
so where are all these "free market" people who say that we need to let the banks fail in order for the economy to correct itself?
 
all joking aside............................its getting very real out here.

Unemployment rate hits 25-year high also.

i cant help but wonder what 2010-2012 really has in store.................im not sayin its end of the world but im really starting to believe we are headed fora serious collapse that will lead into a new beginning.........for the WHOLE world. something big is going down.
 
Originally Posted by TheHealthInspector

so where are all these people who say that we need to let the banks fail in order for the economy to correct itself?
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at banks taking their money out
 
FDIC's fund before this was $50b.
Total uninsured cash deposits at US banks sit at around $6 trillion. prob less than half of that is average joe money.


$500b is gearing up for a massive failure of some sort.
 
wow... getting scary now.

With the information age, I think the great depression will never be repeated entirely - people will be able to find places to keep their money, privateinstitutions and what not.. maybe even interest free, or hell.. you could end up having to pay out even as a depositor. But still - the value of the dollar iswhat worries me with all of this.

This is ridiculous. We need leadership and we need it now.
 
Originally Posted by Mangudai954

Originally Posted by LifeisMoreThanKicks

NO matter what they can not let the FDIC go down because everyone will empty their bank account. But imagine if that happens, everyone will have their life savings in cash and home invasions will sky rocket.
Click to expand...

We'd have a lot more to worry about than home invasions if everyone withdraws.
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Everyone can't empty their bankout. That's impossible,

The Banks are only required to keep 10% of deposits on deck, and believe me they rarely go over this number. Money lent, invested, etc = money made. Moneysitting in the vault = money thats doing absolutely nothing but sitting there waiting for YOU to withdraw. Little benefit to the bank.

If there was a mass bank rush on all major banks, it would be a wrap.
 
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